The emphasis on price and the devaluation of fresh produce needs to end, industry leaders said at the Re:fresh Conference.
Mark Newton, md of Florette UK, said: “There’s been a lot of talk from the trade about listening to what consumers want. What they don’t want is produce that’s been value engineered to within an inch of its life.
“Price always comes third or fourth on the list. People talk about freshness and taste. We’re in danger of forgetting that our product is food, and food should taste fantastic.”
Elaine Alexander, chief executive of South African Table Grape Industry, said: “As prices go down, the product becomes more and more devalued in the eyes of consumers.
“We have to use all our resources to try and turn this around. We demean our consumers by only believing they are interested in price.”
She said there has been a lot of talk about the fact that fresh produce consumption is not growing, or growing slowly, and she believes devaluation is the reason that is happening.
And while prices are falling, costs are continuing to rise, she pointed out: “There are issues on labour in South Africa, but it’s hard for suppliers who are having to foot the bill while their margins are being reduced.
“Our costs are increasing, often because the client is demanding more and more requirements.
“There’s nothing you can do about that, but if you’re not even breaking even, then it’s a problem.”
With that trend continuing, it is inevitable businesses will go under, said John Smith, md of award winning suppliers Greyfriars. “We’ve seen it happen in the mushroom industry. It’s an inevitable trend.”
He said there is a serious problem with balance in the sector: “When you can have the fresh produce industry not doing very well financially while the retailers are generating a 22 per cent return, there’s a serious mis-match there, something is wrong in the sector.
“The amount of work the people in this industry put in is awesome, but we’ve got pitiful returns.”
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